25 Most Important Private Companies
The Top Ten
Uber
It provides 50 million rides per month in the U.S. It operates in more than 400 cities around the world. It employs nearly 7,000 people, not including its million-plus global network of contractor-drivers. Its lobbyists fight nonstop regulatory battles in municipalities from Austin to Seoul, deploying a combination of sweet-talking, threats, and grass-roots campaigning. It has raised a total of $8 billion in venture capital, most recently at a valuation of $62.5 billion—about $10 billion more than Ford Motor’s public market value. Uber is six years old. For these reasons, Uber is Fortune’s most important private company of 2016, a global bully that is ferociously fighting competitors with names like Lyft, Didi, and Ola, even while it is changing assumptions about everything from drunk driving to seamless payment for services rendered. What makes Uber so influential is that it’s as much an idea as a company. A mobile-first, global-fast network that couldn’t have existed without the smartphone platforms developed by Apple and Google, Uber and its many “Uber for …” imitators are changing the face of business. Uber’s ambitions are as big as its youthful accomplishments. It aims to lead in self-driving cars, food delivery, and arranging carpools. One day it will even attempt to go public and leave this list. But not yet.
Vanguard | Fidelity (tie)
Consider this figure: $5 trillion. That’s how much Vanguard Group and Fidelity Investments collectively manage, according to the companies’ most recent figures. It’s no exaggeration to say that the financial security of millions of Americans rests heavily on these two behemoths. Fidelity is the largest provider of 401(k) and related retirement-plan services, and it long thrived with actively managed mutual funds and star managers. Vanguard has always been the omega to Fidelity’s alpha—and in recent years it surpassed its rival in assets under management (Vanguard now oversees $3 trillion). Vanguard’s founder, John Bogle, of course, was the avatar of low-fee, passively managed index funds (and later ETFs). Bogle’s philosophy has become so popular that it has reshaped an entire generation of investors and eventually pushed even Fidelity to follow Vanguard’s lead and offer its own index funds.
Koch Industries
The notoriety of the billionaire brothers Charles and David Koch as political contributors tends to obscure their mostly self-effacing but hugely important company. Koch Industries generates $115 billion in annual revenue in businesses ranging from oil and gas to agriculture, materials, and paper towels. It has used its freedom from the pressures of public markets to make astute long-term bets. For instance, it became a global agribusiness player over a decade via under-the-radar investments; it picked up electronics components manufacturer Molex for $7.2 billion in 2013, anticipating a boom in the Internet of things; and seeing a future of water shortages, Koch has been exploring technologies such as desalination.
Bridgewater Associates
Everything about Bridgewater is radical, from its size to its culture. With more than $150 billion under management, it’s the world’s biggest hedge fund company and has produced a net gain of $45 billion, the most in hedge fund history, according to LCH Investments. (Clients are institutions such as pension funds.) Its flagship $70 billion Pure Alpha fund has averaged 13% annual returns since 1991. The firm is known for founder Ray Dalio’s culture of transparency, governed by 210 “principles.” (Sample: “Only believable people have a right to opinions.”) Recent tensions at the top led the firm to hire ex–Apple exec Jon Rubinstein as co-CEO.
Cargill
Every day most Americans—usually without realizing it—eat food that Cargill has touched in some way. With $120 billion in sales, it is the largest private company in the U.S. and has its hand in almost every part of the food chain, from providing feed to livestock producers to selling ingredients to manufacturers. MacLennan is remaking the 151-year-old company to suit shifting consumer preferences. Cargill has reduced its use of antibiotics in turkeys and cattle, and created a GMO-free corn syrup, among other things. The shake-up is needed: Results have slumped in part because of a slowdown in emerging markets.
